PI Industries Limited (PIIND) Q3 2026 Earnings Call Transcript

Ladies and gentlemen, good morning, and welcome to the PI Industries Limited Q3-FI26 Mornings Conference Call. As a reminder, all participant lines will remain in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal the operator by pressing star, then zero on your touchstone telephone. Please note that this conference is being recorded. I will now hand the contents over to Mr. Siddharth Ragnikar from CDR India for opening remarks. Thank you, and over to you, Siddharth.

Thank you. Good morning, everyone, and thank you for joining us on PI Industries Quarter 3 SI26 Earnings Conference Call. Today, we are joined by senior members of the management team, including Mr. Mayan Singhal, Executive Vice Chairperson and Managing Director, Mr. Rajneesh Karnah, Joint Managing Director, Mr. Sanjay Varwal, Group Chief Financial Officer, Dr. Atul Gupta, CEO, CSM, ACKEM. Mr. Jagresh Rana, Global CEO of PI Health Sciences, and Dr. Ramesh Subramanian, Global CEO of PI Health Sciences. We shall begin the call with key perspectives from Mr. Singel. Following that, Mr. Agarwal will share his views on the company's financial performance. Thereafter, the forum will be open for question and answer session. Before we begin, I would like to underline the statements made on today's conference call could be forward-looking in nature. A disclaimer to this effect has been included in the investor presentation that is available on the stock exchange website and which has been shared with you earlier. I would now like to request Mr. Singhal to share his perspectives with you. Thank you, and over to you.

Yeah, thank you, and thank you and good morning. And again, a little apology for a little sore throat, but I shall try and make my best effort. So I shall commence today's brief perspectives of the global at-camp, industrial environment, and touch upon the PI's performance and the strategic progress. The global crop section market is approaching the latter phase, a prolonged down cycle, driven by the distribution mistaking. Adverse weather conditions in certain regions, soft commodity prices, and elevated interest rates. Channel ventures are gradually normalizing, and in-season buying has begun to improve. All the product pricing continues to remain soft, particularly for the generic category. Thank you. and sensitive to the commodity realization and the liquidity conditions. At the same time, global innovators continue to optimize supply chains and recalibrate inventory levels. We have seen early signs of civilization and gradual improvement expected to come over the borders. Coming to India. In India, there are these Zoe programs. The demand for key agrochemicals during the quarter remains muted due to elevated channel inventories, adverse weather conditions, lowered crop prices, price stabilization stayed under pressure, and volumes have been primarily driven of revenue performance. Looking ahead of the structure, everyone remains intact. Sustained innovation in advanced crop protection, crop Announcement Solutions are sent to the Global Agriculture Productive. Economic challenges, environmental conditions, and considerations and economic realities are shaping the farmer's expectations. Growers are increasingly seeing solutions that are safer for the ecosystem, effective against evolving pests and diseases, resistant, and capable of delivering high productivity to meat and rising demands of food, fiber, and bioenergy. Now, moving to our business highlights, Q326. Over all demand-softing inventory levels of many key products based on the... Thank you. In fact, the low farming demand of high-value products. We will expand the opportunity to funnel support by dedicated business development, building new abilities, operations in the U.S. to Europe, and expanding to the Eastman.

Ladies and gentlemen, we have lodged the line of the management. Please stay connected while I reconnect the management. Thank you. Ladies and gentlemen, we have the management line reconnected. Sir, please proceed.

Yes, sorry. So, despite the near sharpness of our underlying fundamentals remain strong. Development and scale-up of strategic growth platforms are progressing as per plan. A robust balance sheet and an innovative pipeline remains healthy. We have continued to drive a fully integrated research setup. Thank you. Thank you. Thank you. Our long-term outlook remains intact, with a focus on margin discipline. Thank you, everyone, and over to you, Sanjay.

Thank you, Mr. Tengel. Good morning, everyone. So, guys, I'll summarize the company's financial highlights for the quarter ended December 31st, 2025. Q3 performance reflects the continued impact of global industry headwinds that we have been discussing with you in our previous calls. However, we believe the sector is nearing stabilization now and expect sequential improvement beginning quarter four. For Q3, A526, we reported revenue of $13,757 million, which comes on the back of a high base of the same period last year. Despite the global challenges, we know we have still delivered a growth of over a three-year CAGR for the nine-month period. The moderation in ACHEM export is primarily volume-led, driven by slow demand. Also to note that the 9-month period, FI24, for the AgChem export business, we grew by 22%. Similarly, we grew in FI25, 9-month period, by 9%. So going forward, we remain fully confident of the future of our AgChem export business. We have commercialized five new molecules in AgChem exports and four in domestic agri-brands. The 10% growth in new products in AgChem export demonstrates a G-risk in strategy and focused approach to gaining new business in this tough environment. Domestic agrochemical demand remains subdued due to high channel inventory, low commodity prices, delay in normalization of biological portfolio post-regulatory headwind, and specific impact from lower demand in a few target crops for PI. Our domestic business is supported by strong product portfolio and new product launches, which have offset the challenges faced on the ground. We have launched three new herbicides, Alcor, Comet, Fixit, and one insecticide, Uranus, this year, with two more expected to be launched by close of FI26. We expect the domestic growth to be back on track from FI27 onwards. We have also launched our direct-to-farmer mobile app, PM Mitra Kisan, a one-stop farmer engagement solution offering crop advisory, product guidance, and loyalty benefits. This digital platform strengthens our connection with growers and drives scalable, tech-enabled growth. Being on a very strong foundation, increased revenue by 50% over nine months of the previous year, driven by deepening relationship with the biotech and the big pharma innovators. We have onboarded several new customers over the last 12 months, including several strategic accounts and big pharma. Global biologicals continue to progress in line with a long-term roadmap. With ongoing investments and registrations, product development, and global market expansion. On other financial matrices, gross margin expanded to 59% during the quarter, supported by a favorable product mix and cost discipline. Further, at EBITDA level, we have delivered a margin of 27% for a nine-month period, which remains resilient despite industry and widths. During the quarter, net profit includes an exceptional income in a pharma business on account of a write-back of contingent consideration of INR 1260 million, which has been partly offset by additional provisioning of retirement benefits as per new labor code to the tune of INR 209 million. Our trade working capital in terms of days of sales has increased to 139 days and reflects current market conditions. We expect to improve this as market scenario normalizes in the coming quarters. Our debt-free balance sheet position supported with net cash of Rs. 35 billion provides strong resilience and flexibility for strategic investments. While the operating environment remains cautious, we expect gradual recovery beginning quarter 4 FI26, with growth momentum building into FI27 as industry conditions stabilize and our new products ramp up. With this, I conclude my opening remarks. I will now request the moderator to open the forum for Q&A. Thank you.

Thank you. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use their handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We take the first question from the line of Thoroggen from HSBC. Please go ahead.

Thank you for the opportunity. First question is on the guidance. When you say that...

Saurabh, I do apologize to interrupt you there, but your audio is not coming in clear. Would you please use your handset?

Better now?

Yes, better. Please go ahead.

Okay. Thank you. So, first question is on the guidance. When you say growth resuming in fourth quarter, is it only a sequential growth that you're talking about, or you even expect a YY growth? And, you know, what this growth is really? Is it like a volume growth that you're alluding to, or you even expect a revenue growth or a value growth in the fourth quarter?

So, yes, there will be a volume growth from beginning quarter 4, FI26, and yes, there will be a sequential growth in quarter 4 over what we have seen in quarter 3, and as we build in into FI27, we believe with all the efforts we have been put in, we should be on a growth momentum picking up then.

So, volume growth in 4Q, is it also a YY volume growth?

See, well, you know, sitting now, we would target to have a volume growth, but as I said, the momentum will start picking up from FI27 onwards.

Yeah, but just to clarify, we already see the great, we see good momentum of uptick is started in the quarter four. And clearly, as we get into the year, the momentum is, the positive part is, there's a positive moment already seen and witnessed, and I think we should be in a good shape coming in this.

Understood. And then when you say FI27, you are expecting the revenue growth returning to the company in that year. And if possible, can you also give more contours to it, whether you expect a gradual recovery in growth or you expect the growth to open up in a big way?

Yeah, so I think we see the positivity of growth. And as I mentioned in my talk earlier, that, you know, the industry is still having an extended cycle of growth. But given the scenarios, and as you must have seen in this year, there have been many headwinds. Thank you.

Hmm, okay. So, you know, just to kind of continue on that point, because the kind of robust business that we have, right, we have visibility, a lot more visibility compared to the other kinds of businesses, you know, in the sector. So, are you noticing already a great enough visibility from your customer side that you are getting optimistic in terms of a recovery in FI 27? Or is it mainly coming from some optimism that you have?

No, no. I think, as you know, some part of the business is more about what we have from the customer set. But at the same time, if there are adverse headwinds, life shift, and, you know, the PR philosophy of partnership, that goes strong. And even while we have what we've committed to with them, but we have to sit and optimize to handle the market situation. Because, you know, you have to partner up to create value. So we see the uptick in demand, but clearly, as I said, there's been a reset in the way the customers are thinking, the way they're looking at agile supply chains, given the challenges of these prolonged challenges that they've been seeing. But clearly, given where we are, looking at what they feel, the operational aspects of these issues in the industry are getting cleaned up, but the external factors still will have a role to play, and we don't know how reactions happen in the geopolitical scenarios.

Understood. Thank you. That is helpful. The second question is, we noticed that gross margins continue to improve every quarter for you, and I think we delivered a 59% kind of gross margins. Would you also give out a guidance on what kind of gross margin do you expect on a sustainable basis?

So, as you've seen, as always, as we continue to manage the gut margin on a quarter-to-quarter basis, it will be difficult to put that out, as you very clearly would understand, that there are product mixers, there are value mixers which come together, but as we've given the guidance between 50 to 50.

So, we have been delivering quite good kind of gross margins for last few quarters. What is this gap between what is your expectations on a sustainable basis and what we're delivering? What is this gap attributed to? I really don't understand that, say.

Gap of what? Gap of gross margin?

Yeah, so, gap of gross margin. Yeah, I understood your question. See, the thing is, first of all, while we will aim to deliver more, but it is better to be, because there will be a product mix gap between quarter on quarter. So on a yearly basis is when we can talk more with clarity with you. And at the end of the day, whatever gross margin benefits we get, it helps us in investing, the planned investments that we have in the new businesses. And therefore, it is better to track the EBITDA margin. Again, for the nine months, we are at a healthy 26-27%, and we would still hold ourselves for the year, what we started the year with, with 25-26%, and we believe that is where we should target to exit in this financial year. And more, you know, these things, once we have our budgeting exercise completed for FY27, we can give you more guidance for the next year thereafter.

Sure. Thank you so much, and all the best. I'll get back in the queue.

Thank you.

Thank you. Ladies and gentlemen, in the interest of time and fairness to others, we request you to restrict to two questions per participant and rejoin the question queue. We take the next question from the line of Vivek Rajamani from Morgan Stanley. Please go ahead.

Thank you for the opportunity. The first question I had was an extension to the earlier guidance question. Just going to fiscal 27, I know it's a bit early, but would it be possible to give some sense of, you know, you're expecting more like mid-single digit or, you know, high-single digit, any, you know, range, if that's possible? And also, whether it would be broad-based across the portfolio or you expect certain parts of the portfolio contributing more towards that fiscal 27 recovery? That's the first question.

So let me put it, as we said, there is still the softness. I think we're definitely seeing recovery. Now, different pockets, different place. Clearly, it'd be too early to give a guidance of what numbers is tax receipt, but I think coming to the next quarter, as we always do over the decades, is where we'll give a guidance for the next financial year, post the end of the year.

Sure, sir. Understood. The second question with respect to the new products that you've been disclosing, I think for the nine months you've mentioned that the new products have grown at about 10%, which given the first two quarters of the year which saw a very, very strong growth, it seems to suggest that 3Q, that growth of the new portfolio seems to have slowed down. I just wanted to get some color with respect to, you know, were there any specific reasons around that and, you know, if there was some impact on the U.S. status and how should we think about that going forward into fiscal 27? Thank you.

So, at a fundamental level, as I highlighted in my speech, the key challenge is the commodity prices and the demand cycle, which is creating challenges, and the end winds of weather. Obviously, the U.S. policies have impacted the growers, which in turn has a consumption differentiation. It is not the trade policy. I'm sure you know that well. It takes typically a decade plus. And I think that's what the time cycle is. But the positivity is the mix of the new product portfolio, the percentage growth coming from that, and with time, if the industry switches.

Sure, sir. That's helpful. I'll reach on the queue and all the way best.

Thank you. We take the next question from the line of Abhijit Akhela from Court of Institutional Liquities. Please go ahead.

Good morning. Thank you so much. Could you please just update us on the contract assets number on the balance sheet at the end of December, please?

Yeah, Abhijit. So, this particular quarter, the contract assets are in the range of around 1065 Good morning, everyone. And, yeah.

Okay, got it. So, compared to basically about a little under 900 crores last quarter. And in terms of the liquidation timeline for this line, I think we've said in the past that we expect it to come down towards the end of this financial year. So, any sense you could help us with regarding how we should expect the trajectory to shape up over here?

Yes, as you know, yes, that's what we've given a guidance, as you know, and we look at the past history, this is a typical... We have no inventory beyond three to six months. So, clearly, yes, at the end of the year, this will be coming down, and I think I will take a couple of quarters in a further go lower. This is a mix of our asset utilization, capacity utilization, customer contract.

So by year end, where should we expect this number to be, sir?

Well, I can only give you guidance to say it will be reduced, and it will get there, but to give a specific number will depend on how we shape things up in terms of customers' shipments, time. That's really how it is. It's not a specific number that I can come to today.

All right. And then just on the gross margin guidance, you know, so just, you know, trying to understand, I mean, in terms of this 50 to 52% trajectory that we expect, is that something we should expect in the relatively near future itself, say in fiscal 27, or for fiscal 27, what's the line of sight we have? Can we maintain the gross margins around these levels? Fifty-eight, fifty-nine percent.

So, as you mentioned, we have... Thank you.

Yeah, I think I'm done. Thank you so much.

All the best.

Thank you. We take the next question from the line of Rohit Nagaraj from 360 One Capital. Please go ahead.

Thanks for the opportunity, sir. Any update on the plant healthcare when we had acquired this almost one and a half years back, we were expecting some cross-selling of products from India, our own products to the other geographies like where EHC has its presence in U.S., Brazil, Mexico. So, where are we in that process and where can we see some tangible benefits from the same? Thank you.

So, maybe generation. Yes, no, absolutely, and thank you for asking. So, on plant healthcare part of the business, We have made tremendous progress this year. We are expanding our business in Brazil, US, Mexico, and European countries. In Brazil this year, we have gone from last year two distributors to 33 distributors. We have more than 400 farmers who are right now using our product in their own field, testing the product. In case of, similarly in Mexico, we have more than 28 distributors right now who are working with us. In U.S., we are setting up a distribution network for the entire Midwest. And some of the world's largest farmers from Brazil and Mexico, they are basically right now testing our product. They have been working with us. We have also got some new product under registration. We launched two new products in Brazil, two in Mexico. We've just got our disease control product approval in California. That makes the entire U.S. and California is the largest market for that product. We are awaiting an approval for one of our nematode management products in U.S., which is expected sometime this month. And all the trials which we are doing in the farmer's field in Brazil, the harvesting is just getting started and what we are seeing is almost more than 80% wind rate. So we are basically making good progress. In India, we got the plant healthcare product approved and we are looking at launching this product in this next quarter.

Sure, that's helpful. Second question on PEOX and the roll, now that we have signed for the registration in Indian market, what are the timelines that we are looking at from commercialization in Indian market and any progress on, you know, probably having registrations in the global market? Thank you.

I think the progress is within this financial year. We should be achieving the registration so that we're the landmark in the Indian history of a new innovation of bi-accidential growth in the next coming financial year. On the other hand, yes, there are works, regulatory works, which are going in another couple of geographies, so we'll be filing for regulatory registrations in the coming year and hoping as soon as we get the regulatory approval, launch the product at the global platform.

Sure. Thanks a lot for answering all the questions, and all the best, sir.

Thank you. We take the next question from the line of Siddharth Gadeka from Aquarius Securities. Please go ahead.

So, just on the pharma and the biologic business, now if you look at the numbers, we are heavily investing in these businesses, and we are roughly at a 75-80% quarterly EBITDA loss in these segments. So how should we think about these investments from a medium to longer term? And are we at the peak of the investments in these businesses and going ahead, the investment should move in 9,000 overall OPEC?

That's a very good question. See, look first, we need to understand why we are doing it. If we understand that these are good costs, you know, the investments what we are doing is going to be a long-term value creation for the organization. That is where we are at. Now, initially, we have bought, I mean, we've got these businesses, we have incubated them, we have got the people now, and we have to make the right investment. And unfortunately, all of it gets charged off to the P&L. So, yes, it will take some time, like pharma is now getting on to a strong foundation, biologicals, Jagrish just spoke. So, yes, currently they are having P&L charge and we'll have to bear it for some few quarters. But thereafter, we think as an organization, this will be future growth engines for us.

So, they were put in one line, look at these as investments of the future, not as...

So, secondly, just on the CAPEX side, we were working on two multipurpose plants, and now we have expanded that to three multipurpose plants, and we have also spoken about a non-GMT plant in India for farmers. So, the third plant is largely for the farmer business. Is that a fair understanding?

No, as you know, we are looking at certain other verticals, as I mentioned earlier. Where we are, for example.

So, any key things on the pharma intermediate plant that we are setting up in India?

Yes, we will be coming up with the plant and announcing that in the next quarter.

Oh, okay, sir. Thank you so much.

Thank you. Ladies and gentlemen, if you wish to ask a question, please press star and one. We take the next question from the line of Tejas Pradhan from Citigroup. Please go ahead.

Yeah, hi, sir. I know it's early, but could you provide any guidance on the KPEX plan for FY27?

So, broadly, let me give it in line, is there about 500-600 crores, I mean, and obviously, once you get to the whole process procedures, after board approval, make your proper guidance next quarter.

Okay, you mentioned 500-600 crores, right?

Yeah, I think that's where we are today.

Okay, okay, understood. And on the domestic biological registration process, any update where we are, what percentage of portfolio would be already registered?

So, if you look at the domestic and biological portfolio, as you know, at the beginning of the year, we've had certain turmoil in the industry. So, those are getting sorted, I believe, in this quarter. Those should be in the past. Clearly, certain other new products, as we already mentioned, that products like a new cut side of ours, they have happened, it's already registered. And we are looking and evaluating about two to three new products in this segment. And I think today, we have a very robust, large-scale portfolio in biological tools. We are making those investments to scale them out.

Okay, okay. And just lastly, any sort of thought process on the use of cash on balance sheet, if there are any opportunities domestically or elsewhere, how are you thinking about it?

So if you look at the cash on the balance sheet, there will be investments. We are also looking, as we mentioned, on the new entities and technology platforms that we are investing. Clearly, the company has... and a team which is all on the lookout to look at what could be the synergistic in aligned to our strategies, which are knowledge-led capabilities of building a differentiator.

And just to, if I can add, I mean, would this largely be in AgChem or largely looking at outside of AgChem?

So in a lighter way, let me put it, if you have three children, we have to decide which is the best opportunity, which school fits what scale, right? So when you look at the opportunity, we're looking to grow in every sector that we're playing in. So whichever opportunity comes and fits in well, we're going to put it there.

Sure, understood. Thanks a lot, sir.

Thank you. We take the next question from the line of Vivek Rajamani from Morgan Stanley. Please go ahead.

Hi, sir. Thank you so much for the follow-up. This is an extension of the previous participant's question. On the biological side, did you mention that the regulatory issues are now behind and Q4 will potentially be a normal quarter?

No, yes. In the Indian market, if you remember, they are now getting into approval systems, so that's why I'm saying behind. So maybe next year we'll see those pieces come up. Q4 is when they expect. Industry has taken a front and the government has taken initiatives to resolve that.

Sure, sir. Understood. And would it just be possible to share, you know, what is the biological contribution in fiscal 26 so far?

We should be around 21%.

Okay, sir. Thank you. Thank you very much.

Thank you. We take the next question from the line of Ranjit. Sirumala from IIFL Capital. Please go ahead.

Thank you for taking my question. My question is on the right back of the contingent consideration that we have taken of the PI Health Science. How should one view this? Does the original performance thesis of this particular equation remain intact or there is going to be any change in the expectations?

No, no, absolutely. There is no change in the strategy. There is no impact of it, and that's why we renegotiated contingent consideration, which was lying in our books. So, the business is on a strong footing. We have our now experience in our global business development team. So, we're looking forward for our pharma business to scale up and build one of the best global CRD of our platform.

Thank you, sir.

Thank you. We take the next question from the line of Siddharth Pradekar from Equalier Securities. Please go ahead.

So my question is on the plant healthcare business. Can you just say some broader thoughts on how should one think about the overall opportunity and the trajectory of the segment? Specifically on Sonori and Pico, given that we have been looking to ramp up these products, any indicative timelines and could peak a number that we could look at from these products?

Yeah, no, absolutely. So, CEO, to look at it, overall in the industry, biological business globally has been growing in double digits. So, globally, the biological business is in the range of around $10 billion today. This has been continuously growing over 10%. And that's the segment. Basically, we are participating. We are bringing in some of our key products. The difference what we see is overall biological business globally is a fairly crowded space. But we have some unique product and these technologies no one has. We are the first company in the world who has commercialized peptides in agriculture. Peptides have been used in pharma, etc. in the past. But we are the first company who has commercialized in agriculture. And we see this differentiation driving significant growth. Products like Sauri, Teco, these are the plant production product. Within biologicals, the fastest growing segment today is a biocontrol segment because of the challenges, you know, which are coming in like society is looking at, you know, how can they basically bring in the product which have a lesser impact overall. And that's what is driving the growth. Also, farmers are looking at those kind of options which can help their crop to grow better. So we actually see a significant growth opportunity as we expand this portfolio.

Okay. Secondly, we have made a comment in the presentation that we aim at becoming among the top five CIDMOs on the farmer side. Any timelines or how should one think about the investment in the segment going ahead?

Thank you.

Thank you so much.

Thank you. Ladies and gentlemen, if you wish to ask a question, please press star and one. We take the next question from the line of Krishan Parvani from JM Financial. Please go ahead.

Yeah, hi, sir. Thank you for taking my question. Just firstly, I wanted to understand the CSM business that has struggled this quarter. So, you know, when do you expect the CSM business to kind of show a YY growth? Maybe it is six months down the line or nine months down the line. When do you expect it?

So that we first carry a bridge. Well, it's not struggling, number one, it will align the expectation of what we see, but clearly, as I said, we have indicated that coming the quarter, we are already seeing the positive break rate coming from. And the fourth quarter itself starts showing.

Sir, did you mention that the fourth quarter onwards you will have CSM growth again, is that what you are saying?

Okay, okay, okay, okay.

And, you know, when do we expect this pharma contributions to be fairly positive for the company? Because I think our targets to go EBITDA positive have been pushed out. I know you've been, you know, trying a lot, but what's the sense there?

So let me put it, we're definitely putting all the efforts. The idea of EBITDA positivity is something dependent on the market and the opportunity. And clearly, we don't want to lose the focus on what the strategy differentiator will be, just because the markets are twiddly. But I think we have the holding and the building capability, so we're taking more aggressive calls in investing. Hence, you may see the EBITDA challenges. But I do believe that now when the conditions are set, it takes a longer gestation to turn this business up.

Lastly, if I may, you know, it's been quite, it's been some quarter since we have stopped giving out our order book number. So, has it, has the order book declined or what is it, what's the status of it? Can you just help us with that?

No, no, we have been sharing order book. I think last time also we did mention that and as of this quarter, the way we look at it, we are in the range of $1.2 billion of order book.

Thank you for patiently answering my question. Wish you all the best, sir. Thank you so much.

Thank you.

Thank you. We take the next question from the line of Narsha Chaudhary from Aditya Birla Mutual Fund. Please go ahead.

Yeah, hi. Just one question, sir. If you can, you know, touch upon on the... Electronics, chemical, what exactly are we doing here from our end-user point of view, and how big this platform can be for you in the next five years and beyond.

Yeah, so in terms of electronic chemicals, I think there is a good traction. New customers have been added, and the couple of products have gone to the commercialization, and we expect that four to five molecules will be going for commercialization this year. So there is a good amount of, you know, the projects with the new customers getting required, and I see a good amount of traction going forward in the coming years in electronic chemicals.

Can you touch upon the end-user which specific area and space these molecules are targeting?

Then the semiconductor and the high-end application of electronics.

Are these only for domestic market or for export as well?

They only work in a global innovator market.

Thank you so much. All the best.

Thank you. We take the next question from the line of Amit Prada from Canara Rebeco Mutual Fund. Please go ahead.

Yeah, hi, sir. Good morning. Thanks for giving this opportunity. So, my first question is, have you seen some kind of a price realization impacting some of our key products? I just wanted to understand how the pricing or the realization is also behaving when you are anticipating revival in the group.

Well, let me put it this way. Price realization has the overall in the industry shrunk, as you can see.

It's fair to assume that some kind of impact is also seen in our portfolio in terms of some compression in the price realization. And this particular thing, the... When there is a price compression, the thing that you often discuss with the client is like some pass-through or some... Hello, am I audible, no? So I am saying that...

I am not going to hear you.

Am I audible, sir? Sorry.

Yeah.

Hello. My extension to the question was, like, what's the recourse in this particular thing? Is that only recourse is that we try to do a lot of some backward integration, and that's how I try to be better in that particular product, when there is a price compression happening for that particular product.

Or is there a way of finding out... You have to get backward noise too much.

Maybe, maybe I'll just come back. I'll just pick something and I'll come back with my second question.

Thank you. We take the next question from the line of Aditya Jawa from Investec. Please go ahead.

Yeah, hi. Thanks for the opportunity. So, my first question is, I hope you guys can hear me. Yeah, we can hear you with it.

Yeah.

Sir, if you can give me some sense that how has been our penetration in some of the new clients? So clearly, over the last four or five years, we would have added multiple client in different geographies. So is there a line of sight where we can see that in the next couple of years, we should see a meaningful ramp up in some of the new relationships we have started? So which business area are we talking this about? So CSM, this is, you know, I think the elephant in the room.

So in the ag business, we cover all the players already. So it's expanding new businesses. But if you're talking about the electronic and the new verticals, that's where we are basically focusing on companies. We've got five new customers in the areas of electronic chemicals.

Yeah, yeah. So, you know, continuing with this, you know, in the AgChem business, as we, you know, had a strong relationship with Japanese innovators, is there a line of sight where we can say that we are having meaningful contributions coming from, say, European-American innovators in the next couple of years based on our existing business, you know, discussions with them?

So, one, I'm not sure because we're working with European customers, the three big boys for at least last 20 years. They're pioneering partners. So those that continue to have dialogue, new pipelines come in, new valuations happen if you're developing them. And also the American companies, which you would know of.

Sure, sure. Fair enough, fair enough. So, my second question, you know, Sanjay, if you can, you know, throw some light, there has been an increase in the working capital quite sharply, almost from 68 days to 139 days. Why or why? So, could you please explain and how we should expect, you know, the intensity of the working capital coming down?

So, Aditya, you know, this is a reflection of, you know, the global scenario. We had one of the lowest working capital days across the industry. Now, we have to accommodate the needs of our partners. And in those lines is where our net working capital days have gone up much, still much better than the industry benchmark norms. But having said that, I will not be able to give you exact numbers, Aditya, right now, but we expect to improve this as the market scenarios normalize in the coming quarters.

That's it for my time. I'll call back in to you. Thank you. Thanks, Ritia.

Thank you. We take the next question from the line of Arjit Joshi from Nuwama Institutional Equities. Please go ahead.

Thank you. Good morning, and thanks for the opportunity. Sir, I have only one question. I would like to understand your thoughts on the evolving landscape amongst global agri-majors. We have seen some bit of corporate actions happening in some of the large MNC agro innovators. Given this scenario, how do you see the development on new technologies and patented products coming up, especially in regards to their R&D spends? And what would be our stance and capability to have a first-mover advantage with these patented technologies going ahead so that we can garner a good amount of product portfolio and scale-up abilities going ahead. So if you would have a three-to-five-year view on this developing and evolving scenario, I'd like to hear more from you. Thank you.

Well, thanks. I think that's a very good question, and let me put this across very well. Every challenge has an opportunity, and I think PI is the only company which is geared with the philosophy of partnership and technology as an innovator, which creates an opportunity just not in manufacturing, but also in building new entities together. Now, that's the PI value proposition. The history of PI started as partners of licensing, domestic business, and scaling that up as partnership for innovation, the PI way. The next was partnership for innovation manufacturing. Now, we, the company, will lead the path in the ACAM sector for partnering for innovation for new product development. Not only product development, but we opened a few more engines. We've taken the engines of biologicals, maybe creating innovative platforms and partnerships. So the partnership, platform, and PI Innovation are going to be the drivers. Challenging environments gives us a differentiator to partner even deeper in the relationship from markets to restaurants.

Sure, sir. Thank you. Thanks. Thanks, and all the best.

Thank you. Ladies and gentlemen, that was the last question, and we conclude the question and answer session. I now hand the conference over to the management for their closing comments.

Thank you, everybody, for joining us on this call. And also, I'd like to celebrate the Founders Day, an exciting time and day for all of us. So thank you for being here. Bye.

Thank you. On behalf of PI Industries Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your lines.